London stocks slipped on Wednesday as slower-than-expected deceleration in Britain’s inflation knocked off hopes of a June interest rate cut, while Marks & Spencer’s gains after the retailer reported an upbeat annual profit tempered losses.
As of 07:07 GMT, the benchmark FTSE 100 index fell 0.6%, while the pound strengthened against the dollar and touched a two-month high at $1.27425.
The mid-cap FTSE 250 dropped 0.4% to 20,693.65.
British consumer prices (CPI) rose 2.3% in April, slowing from a 3.2% increase in March, while economists polled by Reuters expected a 2.1% rise.
Markets are now pegging a mere 16% chance of a June rate cut by the Bank of England, a dip from the nearly 60% that was priced in last week.
Despite UK inflation edging closer to the BOE’s target, its sluggish deceleration fell short of expectations, casting a pall over investor sentiment.
London stocks slip as Fed’s cautious stance weighs on sentiment
Markets also have Nvidia’s quarterly results on the radar that is due later in the day, and could spark a $200 billion swing in the AI-darling’s shares.
Keeping losses at check, Marks & Spencer jumped 7.4% after the retailer reported a 58% rise in annual profit and was ahead of market expectations.
SSE fell 2.3%, after the power generator and network operator posted a lower annual adjusted operating profit.
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